26 Jul 2008

An HCU moment

Remember I asked a few days ago, what does the Hindu Credit Union have to hide? What could lead Harnarine and his directors to lock out the auditors from Ernst & Young?

Well some rather alarming news is being exposed. For example, the loans policies of HCU seemed as it they'd been tossed out the window... by the directors no less, who made sure that they themselves benefited.

A June 2007 report by an inspection team probing the Hindu Credit Union found evidence that the credit union violated most of its written policies, failed to adhere to the legislation which governed it and replaced its core business—the granting of loans—with the acquisition of properties.

The team found:

"People became members by purchasing $25 in shares and received huge loans in excess of $100,000 on the same day. There were little or no securities found for these loans."

• The fact finding sheets in members' files revealed that although members did not qualify for loans, the loans officer was instructed to grant these loans through telephone conversations from officers of the credit union.

The team even found that the HCU had granted a loan to a non-member who was described as a "Costa Rican employed at the Costa Rican Embassy" who received two loans totalling $269,000 on March 12, 2002, and June 5, 2003.

It was discovered that no repayment was made on either loan and that the interest outstanding on the loan was $234,556.10 as at September 15, 2006.

• Officers with delinquent loans continue to serve on the board of directors of the HCU in contravention of the by-laws

• Loans were not granted in accordance with Section 43 (3) of the Co-operative Societies Act and By-Law 40 (f)

• There were cases where officers had more than one mortgage loan, which violated Bye Law 40 (f)

Huge loans were granted (over $500,000) in excess of their shareholding (some officers holding shares of only $30);

• Delinquent loans were refinanced which contravened the loans policy;

• There were incomplete loan application forms but funds were disbursed

The inspection team found that an HCU director had $19,380.29 in shares with a total loan balance of $1.6 million to purchase property. The loan was classified as an ordinary loan and the interest rate charged was 0.5 per cent.

The inspection report gave another example of a member, employed with an HCU subsidiary, who had $25.33 in shares with a delinquent loan of $150,651 on which the outstanding interest was $58,754.

On February 6, 2005, the member sold a 1.5 tonne Isuzu truck to the credit union for $152,242.73. “This sum was used to clear off the loan principal. On August 18, 2005, interest in the sum of $58,754 was waived. No valuation for this vehicle was carried out. Member is a relative of (an official of HCU), as such a proper valuation of the vehicle should have been done in order to ensure transparency and accountability with respect to this transaction.”

The team found that the HCU Convention Centre was valued at $1 million in November 2001. The property was purchased by an HCU member in March 2002 for $710,000 and sold seven months later to HCU for $2.5 million.

It's been a long time coming but people are finally seeing how corrupt this organisation is (well, the Gov't not too far behind I'd say).

Still, I know a lot of people who will close their eyes and say "Boy, dem is Indian like we, we have to stand up for one anodder and gee dem a chance."

Yeah, and while you 'gee-ing' dem a chance, they screwing you in your nether hole, and picking yuh pocket at the same time.  Then again, how is that different from what Pa-trick and Panday have been doing so long?

Hmm, more and more I am wondering; is it a coincidence they share the same accountant with UDeCOTT? I've asked this before and some people took exception.